Notes march 21 2008

I’ve been thinking that if we look at our institutional arrangements: governance, corporations, schools, infrastructure… it comes up short for solving our problems. –even coping -. What we need is extreme flexibility to face

Climate

Economy

Security

Education

Wealth distribution (so ordinary people can eat and sleep free of crime)

We need flexibility centers in every population center, a place where resources can be reallocated and people shifted from one set of skills to another: multi-generational, somewhat entrepreneurial, and perhaps using local currencies.

For the future we need flexibility. Plans won’t work. It isn’t just that life will be more expensive: people will need different kinds of job. We will need community centers where people can come in with one skill and leave with another. Fast rethinking. It can be done. Just watch a lawyer grasp a new area of say medical malpractice. Awesome to see what can be done with ten books and a week of serious reading.

Every community should have a flexibility center. After all if there are needs and people needing jobs, bringing them together is the core work of a society.

I’ve been thinking that it is strange how so many tech types are tech optimists and social pessimists and don’t try to reconcile the two narratives. My conclusion is, until we release the tech narrative (human thinking and creativity for human well being) from the money-military- tech as wealth transfer (extreme profit) narrative, we will not get the social benefits, but only the social costs.

It is typical right now to blame the American consumer, “The central problem is the US is addicted to consumption that our pocketbooks cannot pay for. So we borrow.”

Wrong. the American consumer is pressed on all sides and used increasing home equity to maintain existing levels of consumption, not increase them. The problem was that increasing home prices first of all benefitted the brokers, from real estate agents to middle men in the borrowing infrastructure, because they got their percentage off the top.

Second, the real victim of price increases were people buying homes for more than they could afford and more than they would have cost if there had not been the bubble. Flat incomes plus increasing home costs created richer rich and poorer poor.

Watch now the struggle in many forms to get the poorer taxpayers to pay the costs of keeping the system afloat. The $150 million tax rebate is one obvious example, since the money will go for the most part to paying delinquent mortgages and credit card debt. Who benefits? It’s obvious.

Blaming the middle class and lower middle class for over consumption is just wrong.

An interesting plan for housing..

own to rent: the subprime protection planWhile there is no way to sustain the bubble,it is possible to devise policies to protectsubprime homeowners facing the prospect oflosing their home. One route is to simply changethe rules on foreclosure, allowing homeownersfacing foreclosure to remain in their home astenants paying the fair market rent. Under this“own to rent” plan, the judge handling the foreclosurewould arrange an appraisal to determinethe market rent for a house, in the same waythat a bank arranges an appraisal to determinethe sale value before issuing a mortgage. Thehomeowner would then have the option to remainin the house indefinitely as a tenant, payingthe fair market rent.